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INDEPENDENTLY-OWNED CAPEL RUG STORE OPENS IN SUBURBAN CHICAGO
18,000 sq. ft. dedicated Capel store in Shaumburg, IL
By Pat Terry
SCHAUMBURG, ILL -- It's been called a superstore, an outlet and a franchise. But the new 18,000-square-foot Capel Rugs store which opened here a few months ago, is none of the above.
Ron Sorkin, general manager, described the concept as a "dedicated area rug store," selling a single brand. Sorkin is part of an investor group which operates this department store of rugs. The investor group has agreed to sell only Capel rugs in return for the exclusive sales territory of Illinois and Wisconsin.
If Sorkin has his way, this will be the first of four suburban Chicago-area Capel Rug stores.
Sorkin was formerly midwest sales manager for Capel. Other partners in the Investment Group were not involved in the rug industry. Sorkin has had a long career in Chicago-area floor coverings, serving as a retailer, manufacturer's rep and president of the Chicago Floor Covering Association.
Capel, the 88-year old Troy, NC vendor is not a novice to the retailing scene. The first independently-owned Capel store opened in Indianapolis in October, 2003. There are also eight corporately owned stores, some dating back 20 years.
Capel manufactures braided rugs in Troy, NC. and also offers a full assortment of imported machine made and hand made rugs.
Capel imports hand made rugs primarily from India and China, and also imports machine made rugs in Belgium, Turkey, Egypt, England and France. Capel also sources machine made rugs from the U.S. One-of-a-kind hand made rugs come from all over the world, including Pakistan, Iran, India and China.
Ron Capel, left, Capel Inc.'s retail store division director, and Ron Sorkin, general manager of the new Chicago Capel store.
Keen Competition
The new Capel store joins a keenly competitive arena for rug sales. The store is located in a building that once housed a Thomasville Furniture Store. Major nearby competitors include the Great Indoors, Home Depot and Lowe's. Even more competition comes "from viable rug departments in higher-end retailers like Marshall Field, Plunkett's and Toms-Price," according to Sorkin.
Sorkin explained why this location was chosen for the new store. "First of all, Capel's research indicated that customers want to shop at a store that specializes in area rugs," said Sorkin. "Second, the company did a lot of demographic research on all the markets it was targeting, to find the best locations. This heavily trafficked section of Golf Road fit the criteria. The location is also close to South Barrington and Inverness, two affluent Chicago suburbs, as well as to major expressways."
The decision was sound, judging by store traffic to date, according to Sorkin. Sales have been generated by both radio and newspaper ads as well as by many referrals, he said.
The store is attacting customers from a wide geographic area, said Sorkin. "We're delivering to customers from Madison, WI,. (a 2 to 2-1/2 hour drive), Indiana and Peoria, IL, as well as Gurnee and the North Shore. We've got people coming regularly from Rockford, IL."
From a demographic standpoint, Capel Rugs is targeting a wide age span, but current ad advertising vehicles, primarily radio and newspapers, primarily reaches the 30-plus crowd.
On the weekend, Capel lures husbands into the store with a guy-friendly lounge: cushy leather chairs and sofa face a big screen TV so no one misses the sports action, and an adjacent counter holds coffeepot and an occasional pastry. Within sight of dad or mom, younger children can amuse themselves in the "kids' room" with its waist-high walls, child-sized table and chairs, games and wrap-around chalkboards.
Two kids recently critiqued the set-up, said Sorkin, pointing to a large chalkboard message: "This rug store rocks."
Every-Day Low Price Policy
Nearly all the 6,500 rugs in stock are hung on
swing arm racks.
The store stocks approximately 6,500 rugs. The retailer also has access to about 25,000 SKUs in the Capel line.
Inventories of all 10 Capel stores are linked by computer. "If a customer comes in for a particular rug, and we don't have the size they need, I can search and find out which store has it, and we will get it," Sorkin explained.
All Capel stores operate on the principal of "Every Day Low Pricing," according to Sorkin. "Stores will run an occasional promotion, but the company does not believe in marking rugs way up, then promoting 50% and 70% discounts. That's not a real sale," he said.
Prices, too, offer consumers a wide choice. "Everyday prices" for a 5x8 open at approximately $129 for a machine-made polypropylene and go up to $1,300 for a wool and silk hand-knotted programmed rug from Tibet.
"I have a lot of hand-knotted rugs in the $3,000 to $6,000 range in 8' x10' and 9' x 12' ," Sorkin added.
The highest priced rugs in the store can range up to $12,000 to $13,000 for a 16' x 22' hand knot.
Department Store Merchandising Concept
On entering the store, customers are presented with a clean, orderly layout, accented with vignettes featuring dining areas, kids' bedrooms or the living room. Extensive track lighting systems are mounted 12 to 13 feet off the floor.
The departmentalized presentation provides customers with a roadmap through what otherwise could be an overwhelming assortment, according to Sorkin.
While most rugs swing from arm racks, the braided rug section presents smaller rugs on tables, 5'x8's on racks and the larger 7'x9's and 8'x11's rolled up in a custom, cubbyhole storage unit. "Larger braided rugs can't be hung," Sorkin explained, "so when people want to see them, we pull them out, and drop them on the floor," said Sorkin.
Rugs are neatly tagged using a computerized system based on inventory control data at Capel's headquarters. "It's a great system because Capel has it all programmed. So when new products come in, the information is already uploaded into our local computer. All we have to do is print the tags," Sorkin explained.
One popular store "department" showcases outdoor rugs, according to Sorkin. Outdoor rug sales began to climb after Sorkin honed his advertising approach, focusing a radio ad specifically on the outdoor category.
Chenille rugs made in Troy, NC, have surged in popularity, too, and have their own display area, as do cotton loop hooks and flat weaves "These are great for kitchens," Sorkin pointed out, noting that more and more rugs are being purchased for dining areas.
Shags, on another rack, have been back for two or three years, but they continue to gain in popularity, according to Sorkin. As if to prove his point, a teenage girl and her mother enter the store and head straight for a large, red shag rug.
High ceilings are a major factor in the presentation of over-size rugs. A display rack showcasing 10' x14' rugs is near the front of the store. To take the rugs down, two Capel staffers use bamboo poles to flip the clips, which pop open and the rug drops down. "We have a specially built scaffold-it's about 11 feet tall-that we keep in the back of the store," explained Sorkin. "Our guys climb up on the scaffold, a couple other people hand the rug up to them, and they clip it at the top of the rack, which is 14' 6" off the floor."
Opening Night Benefits Charity
Bud Young, Capel vice president of marketing,
talking up rugs at opening night party.
This Spring, the store held a grand opening gala which benefited the National Breast Cancer Foundation. Notables included Capel's Ron Capel, retail store division director and Bud Young, Capel's vice president of marketing. Schaumburg city officials were also in attendance.
The company has continued to have in-store special events to build traffic. This Summer, conservative Radio Commentator Mike Gallagher broadcast his show live from Capel Rugs and autographed copies of his book, Surrounded by Idiots. Capel ran a special sale to coincide with the event, and between 150 and 200 people showed up. "It was our best sales day ever," said Sorkin.
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